Housebuilder first to confirm it will ink agreement and estimates cost will be up to 拢120m

Crest Nicholson has become the first housebuilder to announce it will sign a 鈥榩ledge鈥� to remediate mid-rise tower blocks under a proposed deal with the government.

The firm, in a market update today, said the Department for Levelling Up, Housing & Communities (DLUHC) had set a deadline of today (5 April) for housebuilders to confirm they will sign up to the deal. Neither the existence of the pledge nor the 5 April deadline have yet been confirmed by the government, however a housebuilding industry source said DLUHC will announce further details later this week.

In its update, the firm said: 鈥淸Crest Nicholson] has confirmed to DLUHC its intention to sign the building safety pledge, which it believes is in the best interests of the group, taking further steps to support those living in affected buildings.鈥�

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Crest Nicholson told shareholders today the cost of fixing tower blocks will cost it up to 拢120m

Housing secretary Michael Gove has threatened to use new powers, included in the 好色先生TV Safety Bill, to restrict the activities of housebuilders if they don鈥檛 pay into a proposed 拢4bn cladding fund.

Crest said: 鈥淔ailing to agree to these new guidelines would carry further consequences, implemented by DLUHC, that would impact the group鈥檚 ability to operate and trade normally within the housing market.

鈥淭hese restrictions will be enacted in law through proposed amendments to the 好色先生TV Safety Bill which is currently passing through parliament.鈥�

The firm said it was making a provision of 拢80m-拢120m to cover the cost of the commitments contained in the pledge, which it said 鈥渃urrently represents its best estimate of this further liability鈥�.

It is not clear at this stage whether the pledge signed by Crest Nicholson refers only to its own buildings, or 鈥榦rphaned buildings鈥� where the owners or original developers cannot be traced.

Sources that the deal with government involves housebuilders pledging to repair buildings between 11m and 18m they built themselves over the past 30 years without using cash from the 好色先生TV Safety Fund.

If confirmed, the deal and signing of the pledges would partly resolve the dispute over who covers the cost of remediating mid-rise tower blocks after the government decided leaseholders should not pay.

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